10 june 2020

YEAR -1 | Vol 1 | Issue 41 | Ludhiana | Price Rs.2/- Wednesday 10 June, 2020
DERIVATIVES DECODED
by Nitin Shahi
We have discussed all about
derivatives, futures and options. We
covered types of options calls and
puts, we also discussed the usage of
futures, calls and puts. We also
discussedtheGreekofoptions.While
discussing every topic we discussed
thepayoutgraphsofeveryproduct.
With all these discussions we now
understand the basic theory of derivatives. We
understand that the derivatives can be used by
speculators, hedgers and arbitrageurs. We
discussed the concept of beta while
understanding the hedging of portfolio with
futures and options. Now we will discuss some
simple strategies that can be used by every one
who is trading. Many of you would be using these
products and can be a stepping stone for
beginners.
The most used product in derivatives is covered
call.
Covered call is a product used by investors and
tradersaswelltoreducethecostoftheirholding.
Let us exemplify to understand the concept, let us
assume Mr. X owns 250 shares of TCS and he
bought the shares at say 1800. He is a long term
investorandwantstoremaininvestedinthisstock
for a longer period of time. On 5 June,
2020 the stock is trading at Rs. 2053.
Thecalloptionof2200istradingatRs.
16.5 per share and 2250 call option is
trading at 10.25 per share on June 5.
He sells one lot of 2250 @10.25.
There may be three scenarios on
expiry
Scenario1
In the above example by selling call option of
2250. @10.25 Mr. X has practically booked his
profit at 2260.25, which means if the price of TCS
crosses2260.25hewilltenderhisdeliveryofthe
existing stock and book a profit of 460.25 per
sharetherebybookingaprofitof22.79%onhis
investment Purchase Price Qtty Strike price
premiumCMP(onexpiry)
1800 2502250 10.25 2300
ProfitinUnderlying Rs.500
PremiumtobepaidbackRs.100
Netprofit Rs.400
AddpremiumearnedRs.10.25
————-
Totalprofit Rs.410.25
ROI 410.25/1800*100=22.79%
Scenario2
In case the price of TCS do not cross 2250 in the
monthofJunehewillearnapremiumof2562.5
for the month of June only. The annualised return
on investment is 6.25% without making any extra
effort as the broker accepts stock in margin and
also this helps in reducing the cost by Rs.10.25,
this further means that in above example the cost
of purchase will be 1789.75 (1800-10.25)
Purchase Price Qtty Strike price premium CMP (on
expiry)
1800 2502250 10.25 2000
ProfitinUnderlyingRs.200
NetprofitRs.200
————-
Totalprofit Rs.210.25
ROI 210.25/1800*100=11.68%
Additionally the cost of underlying will reduce by
10.25pershare.
In case the stock falls below purchase price in that
case also Mr. X will reduce cost of purchase and he
has the right to sell the stock at a price not below
1800
Scenario3
Purchase Price Qtty Strike price premium CMP (on
expiry)
1800 2502250 10.251700
ProfitinUnderlyingRs.-100
Netprofit Rs.-100
————-
Totalprofit Rs.-89.75
ROI 89.75/1800*100=-4,98
Kindly note that he would have lost 5.55 percent if
callwasnotsold.
In all the scenarios, if the investor or trader has
made up a mind of exiting the position at a
particular price, he may chose to sell the call of
thatparticularprice.Samewayifsomeonedo
not hold one lot of a particular stock, but holds a
bigportfolio,hemayhedgehispositionby
sellingcallofindexoptions
Coveredcallcanbegraphicallydepictedas
Formoredetailsyoumaycontactmeat
cfpnitinshahi@gmail.com
Brief Headlines:
Hero MotoCorp | Company reported a standalone profit at Rs 621 crore the fourth quarter
of FY20 as against Rs 730.32 crore in same period last year, a decline of 15 percent. The
significant fall in tax cost (down 91.5 percent YoY) helped limit the decline in bottomline.
Revenue from operations for the quarter stood at Rs 6,238 crore, falling 21 percent year-on-
year, impacted by lower sales volumes, which declined 25 percent year-on-year to 13.35
lakhunitsduringtheMarchquarter.
Earnings before interest, tax, depreciation and amortisation (EBITDA) plunged 38.3 percent
toRs660croreandmargindipped300bpsto10.6percent.
Aarey Drugs | LTS Investment Fund sold another 1,75,000 shares of the company at Rs 17.80
pershare.
Tourism Finance Corporation | Anirudh Damani sold 5,53,005 shares of the company at Rs
39.17pershare.
UniplyIndustries|SatpalKhattarsold9lakhsharesatRs6.09pershare.
REC | UBS Principal Capital Asia bought 2.2 crore shares at Rs 102.25 per share. However,
Eastspring Investments - Developed and Emerging Asia Equity Fund sold 1,33,50,472 shares
atRs102.25pershare.
Cupid | The company received a repeat order from the Medical Stores Department,
GovernmentofTanzaniaforthesupplyofmalecondomsworthRs23.61crore.
Gujarat Pipavav Port Q4 | Profit was at Rs 47.2 crore versus Rs 50.6 crore in the year-ago
period,revenuestoodatRs161.9croreversusRs180.1crore.
Maruti Suzuki | Production in May stood at 3,714 vehicles against 1,51,188 vehicles in May
2019.
eClerx Services Q4 | Profit stood at Rs 55.4 crore versus Rs 59.2 crore in the year-ago period,
revenuewasatRs350.93croreversusRs365.1crore.
Wipro | The company collaborated with Amazon Web Services to extend DevOps
capabilities.
Bombay Dyeing Q4 | Profit stood at Rs 48.57 crore versus Rs 1,192.6 crore in the year-ago
period,revenuewasatRs313.10croreversusRs2,786.36crore.
KRBL Q4 | Profit stood at Rs 149.68 crore versus Rs 138.53 crore in the year-ago period,
revenuewasatRs1,062.50croreversusRs1,196.41crore.
GraphiteIndia|Companyreporteda94.14percentdeclineinnetprofitatRs25croreforthe
fourth quarter ended March 2020, impacted by COVID-19 pandemic and subsequent
disruptions in the market. The company had posted a net profit of Rs 427 crore in January-
Marchquarterlastfiscal,GraphiteIndiasaidinaregulatoryfiling.
TeamLease Services | Company reported a consolidated net loss of Rs 29.43 crore for the
fourthquarterendedMarch31,mainlyonaccountofhighertaxes.Thecompanyhadposted
anetprofitofRs26.02croreforthesameperiodpreviousfiscal,TeamLease
Services said in a BSE filing. The total revenue stood at Rs 1,345 crore for the quarter under
consideration.ItwasRs1,168.57croreforthesameperiodayearago.
JM Financial | Company has launched a qualified institutional placement, or QIP, with an
indicative issue size of $101.8 million, or up to Rs 770 crore, sources in the know told
Moneycontrol. The QIP has been launched at an indicative price of Rs 70 per share, which
represents a 1.41 percent discount to the last closing priceon June 9, according to one of the
personscitedabove.AnotherpersonconfirmedtheQIPdetails.
Bharti Airtel | Company's wholly-owned subsidiary, Bharti International (Singapore) Pte Ltd,
bought an additional 6.3 percent stake in Bangladesh’s second-largest telecom operator,
RobiAxiataLtdforanundisclosedamountfromJapanesetelecommajorNTTDocomoInc.
Yes Bank | Bank on June 9 said that Madhu Kapur, wife of the bank's late co-founder
AshokKapur,andherfamilyhavewithdrawnacasefiledagainstitin2013.Thecasewas
filedbyKapurwhenthefamilywaslockedinapitchedbattlewiththebank,then
headedbyRanaKapoorwhowassubsequentlydismissedbyRBIin2018.
S u p r e m e
Courttodecideif
NBFCs can offer
moratorium If
the sector can
give relief, many
realtors are likely
tobenefit
The realtors
association had
also pleaded that the government and RBI should
clarify whether the circular on moratorium was
binding or discretionary. The RBI circular had
indicated it was not binding, whereas RBI governor
ShaktikantaDashadstateditwasbinding.Acircular
by the RBI dated March 27 has allowed banks to
give such a moratorium but a realtors body wants
to know whether NBFCs can also offer such relief. A
bench of Justices Ashok Bhushan, M.R.Shah and V.
Ramasubramanium on Tuesday posted the matter
forhearingonJune12.
The court was dealing with a petition filed by
the Confederation of Real Estate Developers’
Association of India (CREDAI) which had sought a
clarification as real estate developers can take
advantage of the moratorium if it applied to NBFCs
from whom they had taken huge loans. The
moratorium was valid till May but has now been
extended till August.The realtors association had
also pleaded that the government and RBI should
clarify whether the circular on moratorium was
bindingordiscretionary.
The RBI circular had indicated it was not
binding,whereasRBIgovernorShaktikantaDashad
stated it was binding.The Supreme Court on April
30 had directed th Reserve Bank of India to ensure
the moratorium be implemented in “letter and
spirit”.The apex court had passed the earlier order
on a batch of PILs pleading that banks should not
adopt any coercive step to recover dues and must
abidebythecircular.
The circular allows banks to declare a three-
month moratorium on all term loans outstanding
as on March 1, 2020, as well as on working capital
facilities. According to the realtors, the circular was
not clear on the duties of NBFCs as many
organisations and business houses had availed
loans from them. The regulatory measures were
intended to mitigate the burden of debt servicing
brought about by disruptions on account of the
Covid-19 pandemic and to ensure the continuity of
viablebusinesses.
It was felt that there may be a temporary
disruption in the cash flows and in some cases loss
of income for the businesses and individuals.The
moratorium will work to bring relief to the
businesses and individuals. The apex court is also
hearing another case on the moratorium that
relates to whether the relief applies to interest on
theloans.
Supreme Court to decide if NBFCs can offer moratorium
HDFC, LTFH, LIC HOUSING FINANCE, India Bulls etc In Focus this week

Wednesday 10 June, 2020
Owner & Publisher FINDOC CAPITAL MART PRIVATE LIMITED, Printed by Rakesh Kumar Prop. of Bhagotra Printers , 111 Sukhdev Market, Back Side Kailash Cinema,
Nr. Petrol Pump, Civil Lines, Ludhiana and Published at 5th Floor, Kartar Bhawan, Nr. PAU Gate No.1, Ferozepur Road, Ludhiana. By Nitin Shahi, Editor of Findoc Prime.
Stock Report
Derivative Analysis
Global economy to shrink 5.2% this
year due to coronavirus pandemic
OPEC & its allies agree to cut oil
production by about 10% till July:
@David
MalpassWB
GThe global
e c o n o m y,
which has
plunged into
a s e v e r e
contraction,
will shrink by 5.2 per cent this year due to
the massive shock of the coronavirus
pandemic and the shutdown measures to
contain it, the World Bank said Yesterday.
The coronavirus recession is the first since
1870 to be triggered solely by a pandemic,
World Bank President David Malpass said in
his foreword to the latest edition of the
Global Economic Prospect report released
inWashingtonYesterday.
According to the report, economic
activity among advanced economies is
anticipated to shrink by seven per cent in
2020 as domestic demand and supply,
trade and finance have been severely
disrupted.
Emerging Markets and Developing
Economies (EMDEs) are expected to shrink
by 2.5 per cent this year, their first
contraction as a group in at least 60 years, it
said. Per capita incomes are expected to
decline by 3.6 per cent, which will tip
millionsofpeopleintoextremepovertythis
year,accordingtothereport.
According to World Bank President
Malpass, beyond the staggering economic
impacts,thepandemicwillalsohavesevere
and long-lasting socio-economic impacts
that may well weaken long-term growth
prospects -- the plunge in investment
because of elevated uncertainty, the
erosion of human capital from the legions
of unemployed and the potential for
rupturesoftradeandsupplylinkages.
The current projections suggest that the
coronavirus recession will involve a decline
in global per capita Gross Domestic Product
(GDP)by6.2percent,makingitthedeepest
global recession since 1945-46, and more
than twice as deep as the recession
associated with the global financial crisis,
thereportsaid.
Current forecasts suggest that in 2020,
the highest share of economies will
experience contractions in annual per
capitaGDPsince1870,itsaid.
Economic Calendar
FILE PICOrganization of the
Petroleum Exporting Countries
(OPEC) and allied nations have
agreedtoextendaproductioncutof
nearly 10 million barrels of oil a day
through the end of July, hoping to
boost energy prices hard hit by the
Coronaviruspandemic.
Ministers of the cartel and
outside nations like Russia met via
video conference to adopt the
measure, aimed at cutting out the
exc e s s
product
i o n
depress
i n g
p r i c e s
a s
g l o b a l
aviation
remains
largely
ground
ed due
t o t h e
pandem
ic. It represents some 10 per cent of
theworld'soverallsupply.
Algerian Oil Minister Mohamed
Arkab, the current OPEC president,
warned attendees that the global oil
inventory would soar to 1.5 billion
barrelsbythemid-pointofthisyear.
The decision came in a
unanimous vote, Energy Minister
Suhail al-Mazrouei of the United
ArabEmirateswroteonTwitter.
Positive for ONGC, Oil India & Reliance

A confident leader can lead the team from
frontandifhehimselfisconfidentwholeofthe
teamwaitsforhisdecision.
A successful leader takes a lot of decisions
some decisions are right and some may go
wrong.
With every right decision his confidence
increases and a leader whose majority of
decision are right is respected and in times
when a advice is needed he is treated as
decisionmaker.
As a leader your team looks at you to take
decision and if the leader is confident, the
morale of the team remains on top of the
world. The team always remain zealous and
enthusiasm remains uplifted. Besides being
confident, he must be humble, ready to tackle
failure and own responsibility, always lead
fromthefront.
A paper presented at Working Collaboratively
for Sustainability International Conference,
Seattle University, Seattle, Washington, April
12, 2009 Says “Transcendent leadership,
grounded in servant leadership, offers a
pathway to increased trust necessary for
global sustainability. Transcendent leadership
offers a more inclusive and consensual
decision making process for the economic,
social, and environmental sectors, moving
beyond a singular focus on the bottom line of
profits to a multiple focus on the triple bottom
linesofprofits,people,andplanet.”
I find one such leader in our ex cricket captain
M S Dhoni who is said to be a lucky captain, but
luck can not favour in series of cups which has
international acknowledgments. Under his
leadership a India won twenty 20 World Cup,
ICC World Cup Asia cup and many more
trophies,besidesbeingagreatstumperhewas
a great observer with lightning decision
making power. He had enough courage to take
riskandhealwaysledfromthefront.
Few such decisions which were full of his
confidence I would like to share which made
Indianfortuneinthecricket.
In 2007, he asked Joginder Sharma to bowl
crucial 20th over in twenty 20 World Cup final
against Pakistan. He had the option of
Harbhajan Singh to bowl the last over, Pakistan
needed 13 runs to win and in form batsman
Misbah UL Huq was on creeze. Joginder
bowled Misbah ul huq and India won the title.
Than he told that Huq plays spin attack very
well and Harbhajan was already expensive in
that match, so he opt out Harbhajan Lt bowl
lastover.
India was struggling in World Cup Final of 2011
and lost early wickets of Sachin and Sehwag,
when Gambhir and Virat gave some strength
to Indian Cricket team. Virat got out when the
score was 114 for lost of 3 wickets. Though
Yuvraj was in form batsman, he decided to go
up the ladder himself, led the team from the
front and won the match. Dhoni scores
unbeaten 91. Dhoni gave two reasons, one he
wanted a combination of left and right
batsman where Gambhir was a left hand
batsman and he himself was right hand
batsman. Though Yuvraj was also a left handed
batsman. Second reason which was more
important is that Dhoni and Muralitharan the
classic spinner of Sri Lanka were playing in IPL
undersameteamandhehad
faced Marali so many times, so it is better to
upgradehimselfinbattinglineup.
There is list of such bold decisions that he had
taken for the betterment of the country which
must be applauded and must be considered as
a confident leader and at the time of futility,
leaderhastoleadfrom
front and the confidence of leader to take a
decisionorriskonlycansave.
Thus a leader has to be active, supportive,
humble able. To face failures and decisive for
beingsuccessful.
by Nitin Shahi
The wisdom tooth
The most important character of a good and successful leader is to be confident.
RESULTS PREVIEW (value in millions)
Disclaimer : The Opinions expressed are not any recommendations to buy/sell and are findings of a material. Moreover we urge our subscribers
& readers to consult their investment advisor before investing
Disclaimer: The report only represents personal opinions and are for educational purposes. No part of the report should be considered as recommendation for buying/selling any stock.
Sell 1335-1330 Sl - 1355 Tgt - 1300-1280Sell 10150-10100 Sl- 10200 Tgt- 9800-9600
Buy 145-148 Sl- 135 Tgt - 165-175
Buy Near 560 Sl- 545 Tgt- 590-610
Nifty Bank Kotak Bank
Rbl Bank
Bharti Airtel

Larsen Toubro Infotech Ltd is one of the IT
majors in India. The company ranks in top 6 IT-
BPMplayersofIndia.
(A)ExecutiveManagement
(I) A.M. Naik – Group Chairman – Age 78
years
Mr. Anil ManibhaiNaik joined L&T as a
Junior Engineer in 1965. He rapidly rose to
positions of increasing responsibility as he
moved from General Manager to MD & CEO.
Eventually, leading to his appointment as
Chairman & Managing Director on December
29, 2003. Effective April 2012, the Board of
Directors extended Mr.Naik’s tenure as Group
Executive Chairman.Under his leadership, L&T
expanded its portfolio into new age businesses
like information technology & engineering
services.
(ii) Mr Sanjay Jalona – CEO & Managing
Director–Age51years
He joined the company in 2015. Prior to
joiningL&TInfotechheheldthepositionofEVP
& Global Head of High-Tech, Manufacturing
and Engineering Services business at Infosys. In
Infosys,heheldvariousleadershippositionsfor
15 years. He also worked with Gemplus&
Wipro. Mr Sanjay holds engineering degree
from BITS Pilani.His remuneration for FY19 is
Rs.21.03crore&Rs.13.97croreforFY18.
(iii) Mr.SudhirChaturvedi – WTD &
President–Sales–Age49years
He holds engineering degree from Pune
University as well as double MBAs in Marketing
and Finance from Symbiosis Institute of
Business Management in Pune and from Leeds
University in UK. Mr.Sudhir has over 25 years of
industry experience across Sales, Business
Development, Consulting and Delivery
Operations. He spent more than 13 years at
Infosys in various leadership positions.He
joined L&T Infotech in 2016. Prior to LTI, he was
the Chief Operating Officer at NIIT
Technologies where he was responsible for
worldwide sales and delivery for technology
andbusinessservices.
His remuneration for FY19 is Rs. 10.80
crore&Rs.9.75croreforFY18.
(B) Revenue segments as per IT Services &
Solutions
ADM=Applicationdatamanagement
(C) Growth of L&T InfotechIT services &
solutionsrevenue
(D) Revenue as per Business Verticals of L&T
Infotech
*BFS-Banking&FinancialServices
*CPG-ConsumerPackagedGoods
(E) Growth of revenue of Business
Verticals
(F)RevenuebyGeography
(G)DigitalRevenueofL&TInfotech
40.30% of the company’s revenue is from
digitalbusiness.Thisratiowas26%forFY17.
(H)ClientContributiontoRevenue
L&T Infotech has 424 clients as on 31 March
2020 as against 343 as 31 March 2019. The
company’ client count as on 31 March 2017
was around 250. More than 95% revenue is
fromexistingclientseachyear.
(I) Acquisitions & Partnerships during
FY20
•May 2019: Syncordis S.A., company’s
wholly owned subsidiary, announced a
strategic global partnership with ‘Temenos’.
Thus, enabling Syncordis to seamlessly offer an
array of Temenos certified services to banks
acrosstheglobe.
•July 2019: Further, the company
announced to acquire Lymbyc Solutions Pvt
Ltd, headquartered in Bangalore. The
acquisitionamountedtoINR380million.
Lymbyc has an Al led predictive insights
platform. It is driven by an adaptive machine
learning engine providing differentiated
analytics solutions to clients across industry
segments.
•Oct 2019: Moreover, the company
acquired PowerupCloud Technologies Pvt Ltd.
The acquired entity is an AWS Premier
Consulting partner with capabilities in Cloud
Consulting, migration, cloud native application
development and managed services.
PowerupCloud also specializes in Azure and
GCP Cloud platforms. The cash consideration
amountedtoUSD15million.
(J)Outlook
•For FY21, management is confident over
ramp up of deals won during 2nd half of FY20.
In Q4 FY20, company announced 2 large deal
wins with total estimated contracted value of
USD 113 million. One deal is with a
G o v e r n m e n t M i n i s t r y f o r d i g i t a l
transformation. The other deal on the other
hand, is with an European retail client for
managingITapplications&infrastructure.
•Till FY20, management’s guidance on
sustainablemarginremained14-15%
•For FY21, management did not provide
marginguidance.
•Also, the Management does not provide
toplinegrowthguidance.
•Management aims to grow its top line on
the basis of deal wins & acquisitions
capabilities with a sustainable margin
percentage.
•Also, company’s digital business growth
expects to bring higher realizations. This is led
by opportunities in cloud initiatives, work from
homeoperations.
(J) Current challenges due to COVID-19
Pandemic
•L&T Infotech foresees biggest challenges
in overall slowdown of BFSI segment,
manufacturing companies and oil & gas. Oil &
gas segments also gets impacted due to steep
fallinoilprice.
•Consumer packaged goods and retail
segmentsshallnotbeimpactedmuch.
•Fundamental business models for IT
services had been shaken during COVID-19
crisis and work from home would be part of the
futureofITservices.
•Further growth is dependent on clients
transforming to cloud infrastructure &
requirementofstrongdigitalITservices.
Disclaimer: The report only represents
personal opinions and views of the author. No
part of the report should be considered as
recommendationforbuying/sellinganystock.
L&T Infotech: Digital Business Growth Story
By CA Paras Behl
Head Equities - PA Wealth Advisors
blog.pawealthadvisors.com
Zinc
Disclaimer: The report only represents personal opinions and are for educational purposes. No
part of the report should be considered as recommendation for buying/selling any stock.
Sell 163-163.50 SL-165 Tgt-160-158
Commodity Picks
Silver
Buy Above 48500 SL-48100Tgt-49250

10 june 2020

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10 june 2020